JON SOPEL: And I'm joined now from Birmingham by the Schools Minister, Jacqui Smith. Jacqui Smith, welcome to the Politics Show.

You've made clear that you're opposed to selection by examination, which a lot of Labour MPs get hot under the collar about.

What forms of selection would be permissible?

JACQUI SMITH: Well what we're clear about is that erm, you're absolutely right, this is not about selection by ability.

Some people have been worried about that, in fact it's not about selection per se at all, it's about making sure, as Helen emphasised that every child is getting the chance to get a good education.

We're - you know the reason why we're discussing passionately in the Labour Party, this White Paper is because we are passionate about education and that's making sure that every child is in a good school, that every parent is engaged in, everybody is making progress.

JON SOPEL: And schools compete and therefore forms of selection come in to play. I mean would selection by interview be acceptable.

JACQUI SMITH: We, we're very clear in the admissions code of practice, which of course we introduced in 1998, that selection by interview is not good practice but actually erm ...

JON SOPEL: But not outlawed.

JACQUI SMITH: Well, well it is effectively bad practice and to all intents and purposes, as all schools, and they will continue to, have to have regard to that code of practice. You know, this is not about introducing that sort of selection at all.

JON SOPEL: You keep using the word bad practice, but it would be permissible to have selection by interview.

JACQUI SMITH: No, let's be clear, the admissions system is governed by a code of practice that we introduced with recourse to a statutory adjudicator who can rule admissions practices out of order, and frequently does.

That's the current basis that we introduced, that's the basis on which we'll be going forward but what's more important and in fact actually this isn't about competition between schools, this is about what we are passionate about in the Labour Party and that is how we can make sure that every child in every school is making the sort of progress that we want to see them making.

That's why at the heart of White Paper is how we personalise education, how we get parents engaged, how we build on the successes in our schools (overlaps) ...

JON SOPEL: Yes but at the moment you're not saying that the code for admissions should be statutory. Will you introduce a statutory code of practice for admissions?

JACQUI SMITH: No, what we're saying very clearly, Ruth Kelly said it very clearly, is that this, there is nothing in here that is about re-introducing selection by the back door, the front door or any other door and frankly, that's a, that is a side issue.

I know that my colleagues are concerned about admissions, that's because they share my passion to make sure that every child gets the chance to make progress, that we push all schools to be as good as they can do and that's why we spell out in the White Paper how we support you know ...

JON SOPEL: But is that something you might compromise on if Labour MPs demand it and say, look this is the price of our support.

JACQUI SMITH: Well I think it's important that we're clear with our colleagues and this is one of the things we're talking about at the moment, that this is not about selection, that it is about a fair admission system - the system that we introduced when we introduced the code of practice, that we backed up with a statutory adjudicator, an adjudicator who ruled in a hundred and - just over a hundred cases last year and in many cases helped to make admissions fairer you know, this is about fair admissions. We've been clear about that. It's about fair funding, but fundamentally it's about making sure we deliver what all of us want to see and that is better opportunities for the young people we represent.

JON SOPEL: We've just seen the film in Hertfordshire, just a few miles north of London - mixed ability comprehensives, achieving good GCSE results, run by local authorities, why change it when it's working there?

JACQUI SMITH: Well we want to see all of, all schools getting the sort of good results that there were at Beaumont. What we - one of the things that has helped us to improve standards has been for example the specialist school programme.

I spoke at the specialist school trust on Friday, lots of enthusiastic head teachers, using the input of external partners, to help to drive improvements in their school. Now it's building on that sort of experience, flexible schools, using external partners, that is the basis for the Trust model.

JON SOPEL: But even impeccably Blairite MPs, as you well know, are very, have grave reservations about the policy, because they can't see why good local authorities are being shorn of their power.

JACQUI SMITH: Well good local authorities aren't being. What we're being very clear about is the role for local authorities should be about championing parents and pupils. It should be about making sure that there are enough good school places so that parents really are confident that they're getting the access to them for their children.

But actually all of the reforms that we've made since 1997 have already put more control in the hands of good head teachers, and governing bodies, which is where it should be and what we're doing is we're actually building on that system. We're actually making it more consistent in a way which is going forward in the White Paper.

BOTH TOGETHER

JON SOPEL: What of the charge that this is a policy essentially to deal with the problem in London that is irrelevant to the rest of the country.

JACQUI SMITH: Well, that's completely wrong. In actual fact of course, what we've succeeded in doing in London is to improve standards quite considerably.

Frankly the areas where we need to do more to improve the numbers of young people getting five good GCSEs are the north west, the north east, the west Midlands, my constituency, where I want to be confident that every child is getting the absolutely best that they can do in our schools. This is a policy that is about the whole country and it's about every single child.

JON SOPEL: Why are so many Labour MPs opposed to the proposals?

JACQUI SMITH: Well, er, Labour MPs often came in to the Labour Party as I did, because they are passionate about education. Passionate about the chances that that gives to children, particularly those from the most disadvantaged backgrounds.

JON SOPEL: That doesn't answer the question.

JACQUI SMITH: And that, well, I'm just coming to that. And that is why they like I, want to make sure that these are policies which deliver that. We believe that they are, (interjects) ... we want to ...

JON SOPEL: And they believe the policies are a dog's dinner.

JACQUI SMITH: No, no they don't actually. They believe that very many of them are actually going to help to make that difference and it's our responsibility and that's what we're doing at the moment to engage with them, and others on how we can make sure that that objective of making every school a good school and ensuring every child and young person within those schools makes progress, is what we're about and that's why we're discussing with them - but it's because of that passion for education that there's the interest and the engagement that there is at the moment.

JON SOPEL: Do you have to accept that you have to compromise still further if this has any chance of becoming legislation, and in which case, then Tony Blair's great bold thing of you know, where we have to reform and I always wish I'd gone further, will look a bit hollow when it comes to the vote.

JACQUI SMITH: Well we're not willing to compromise on quality for our young people. As Barry said, you know, we won a third General Election victory in May with education as our top priority, that's something that I know my colleagues share - we're not compromising on opportunities for our young people. What we need to do is to work together to make sure that those can reach all of our schools and all of our young people.

That we can bring in the external support that we need, that we can focus on, on catch up and support for every young child who, young person who need them.

JON SOPEL: And in a word, very briefly, would it matter if the only way to get this through is with Conservative support?

JACQUI SMITH: Well I hope Conservatives and others will support us in our ambition unfortunately they haven't done up until now, which is why it's taken a Labour government to make the sort of progress that we have made, and why we'll build on that in this White Paper and in the Bill.

Mr Osborne, it seems that what underlies the row between Gordon Brown and Lord Turner is that Mr Brown doesn't believe that something is fundamentally wrong with what we've got and that you need to make radical change.

Where do you stand?

GEORGE OSBORNE: Well I think he's wrong about that. I mean there is something fundamentally wrong with the current situation and it's largely been brought about by Gordon Brown's policies.

I mean his five billion pound pension tax undermined personal pension savings, and his extension of means testing using the state benefits system to means test the pension credit, has meant that many people don't have an incentive to save for their retirement. And I think that's the context in which this row has taken place with Lord Turner.

That, there's a Brown vision, which is more and more means testing and Turner seems to be suggesting, although we'll see the actual Report next week, that a more basic and more generous universal pension is a platform upon which you can encourage more private saving.

JON SOPEL: That five billion, you're committed to reversing that.

GEORGE OSBORNE: Well very sadly, I don't think it would make the difference any more because we looked at this before the last election and the £5bn raid was the straw that broke the camel's back of many final salary schemes.

But actually, we talked to a lot of FTSE 100 companies and said, Look, if we reverse this tax, will you re-open your final salary scheme, and very sadly they said the ... has already been sold on that; so we do need to look at other ways perhaps using tax incentives to encourage people to save, but I would love to say, it's as simple as reversing that pensions tax, unfortunately it isn't.

JON SOPEL: What about compulsion. I mean could you compel people to save?

GEORGE OSBORNE: Well I think you've got to keep an open mind about these things and indeed my critique of Gordon Brown is that he is trying to kill the pension, er the Turner Report, before its even been published and he's not allowing a debate. So I'm happy to have a debate about ...

JON SOPEL: Well Tony Blair has made clear that actually everything is on the table, everything is to be discussed and they're looking forward to receiving the report.

GEORGE OSBORNE: Jon, anyone who believes that Tony Blair is going to have the slightest say in how the Government responds to the Turner Report, hasn't followed the working of this government. Gordon Brown regards this as his territory, and this is him saying, I'm in charge of pensions policy, and I'm not listening to what Turner or anyone else is saying.

And that is partly because what this report is about and what the crisis is about is about what Gordon Brown's policies have done for the pension system, and the one thing we know of the Chancellor is he doesn't like being told he's wrong.

JON SOPEL: The Sunday Times today reports that Gordon Brown wants to tear up this deal that Alan Johnson agreed with the public sector unions, that they should continue to be allowed to retire at the age of sixty. Is he right to do that?

GEORGE OSBORNE: Absolutely if that is what he's going to do. I mean I, I - I'm very sceptical of newspaper speculation of Brown saying, I'm going to do this and I'm going to do that. He often fails to do it.

But I think it is completely unacceptable to have an arrangement whereby example, for example, someone who's twenty and they have joined the Civil Service this year, is going to be able to retire in forty years time at sixty, when the rest of the country may be being asked to retire at sixty seven.

That inequity between the two systems, creating a two tier pension arrangements between the private and public sector is unsustainable and certainly if Gordon Brown doesn't tear up that deal, I don't think we can regard that deal as sacrosanct should there be a Tory government.

JON SOPEL: But, but you seem to be kind of vaguely unhappy with various aspects of it and you say there's too much means testing. But you don't seem to want to come up with the radical ideas that is going to solve this crisis. You say it's a grave problem, and yet where is the solution?

GEORGE OSBORNE: Well we just fought a General Election and in that General Election the Conservative Party put forward a number of ideas. A more generous basic pension, a more universal basic pension, so that women for example, who've not built up a proper contribution record will get a generous pension.

JON SOPEL: Let me interrupt you, with the black hole that there is, that you say is there, what's the solution to that? Is it through increased taxation or lower spending to fill it?

GEORGE OSBORNE: Well the current arrangements are already very expensive because of the extension of means testing. Let's look at how Turner deals with the affordability of these proposals but he of course has one solution which we should be open to, which is raising the retirement age over a very long period of time to sixty-seven, because thankfully we're all living longer and life expectancy has grown, that's one way of helping pay for a more generous, universal basic pension, which acts as a platform, upon which we can lever in much more private saving, so that people are generous provided for in their retirement.

JON SOPEL: I just want to ask you a final question about Lord Archer and his possible return to the Conservative Party. Would you welcome him back to front line politics?

GEORGE OSBORNE: No. I think is there no prospect certainly if David Cameron is elected leader of the Conservative Party, that Jeffrey Archer will be a Conservative politician.

JON SOPEL: Would he be allowed to join a Conservative association?

GEORGE OSBORNE: Well there is, there are a third of a million Tory members, there's a process for dealing with that, whether he can join or not, that's not a decision for the party leader. What is a decision for the party leader is, does he represent the Conservative Party in parliament.